IVF Refund and Package Programs

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Seventy percent of IVF cycles fail, and when patients do multiple cycles the costs climb fast. To offset this, roughly half of U.S. clinics offer the chance to pay up front to buy a package of treatments at a discount, sometimes with a refund if you don’t succeed. In effect, this is a gamble on the patient’s part. If you need to use these extra treatments, you purchased them at a discount. But, if you have a baby or get pregnant before using all these cycles, you don’t get your money back.

This is an insanely complex subject, and to get to the bottom of the matter we surveyed over 300 fertility patients involved in such programs, interviewed a number of clinics and the major third party companies (Integramed and ARC) that administer these benefits at arm’s length. Consider this a broad outline and since program specifics can change in time, or vary by provider, make sure you get the details and fine print before signing on to any program.

Here’s Our Major Takeaways

These plans are wildly different depending on which clinic you go to & who administers the plan

Plans that offer a refund have very different risk / rewards attributes than “plain bundled treatment packages"

For most refund program enrollees, this is a bad deal. The majority (2/3) of accepted patients succeed on their 1st retrieval, and over half succeed on the 1st transfer from that first retrieval

According to our data, there is some evidence to suggest patients in refund programs are treated more aggressively. Clinics and plan administrators don’t agree

The “sticker price” of refund and “plain package” programs is far lower than what you’ll really spend. Likely by 25 – 50%

Despite all this, most patients who participate feel as though this was a good deal (even when they know they shelled out money on treatments they never used)

The Basics On Cycles and Transfers

A first concept to level-set on is that of a “cycle” and that of a “transfer”. A cycle starts when a woman begins hormone therapy to ultimately have her eggs retrieved. Thereafter, embryos are created and transferred. Often times a retrieval yields several embryos (more than you’d want to use in one transfer, as you'll see here), so a patient will undergo multiple “transfers” until she has used all her available embryos. Then the cycle is over.

As an example, let’s say if you’re doing "pay-as-you-go", one egg retrieval costs $15,000 and each embryo transfer costs $3,000. That would make a cycle with one transfer cost $18,000. If your first transfer fails, but you have extra embryos and do another transfer, that cycle would then be $21,000. Sixty to seventy percent of all cycles, after all embryos are transferred, don’t result in a baby. If the patient wants to cycle again, she pays another $15,000 and again, $3,000 for every transfer.

Premise of Packages

When a fertility patient buys a package of treatments, she is purchasing cycles and transfers in bulk, up-front, at a discount to what she’d pay for each treatment individually. She does not get money back for cycles she does not use. Here are some examples with sample prices:

1 Cycle Bundle:

Patient pays $20,000 for one retrieval with access to unlimited transfers. If she succeeds on the first transfer, she likely overspent by $2,000 because the retrieval and one transfer (as mentioned above) would otherwise cost $18,000. If she uses 3 transfers, she’s saved $4,000, because that retrieval would have cost $15,000 and the three transfers would have cost a combined $9,000.

We should note that we’re being simplistic here and ignore whether a patient might be paying a la carte for other expenses like monitoring, anesthesia and the like – for convenience we’re lumping these together in the “retrieval” costs.

2 Cycle Bundle:

Patient spends $25,000 for two retrievals, and two transfers, that would ordinarily cost $36,000 (two retrievals at $30,000 plus two transfers at $6,000)

If she succeeds on the first transfer, she has overspent by $7,000 ($25,000 minus $18,000). If she goes to transfer on the second cycle, she has saved $11,000 ($36,000 minus $25,000).

3 Cycle Bundle:

Patient pays $35,000 for three retrievals, and three transfers, that would ordinarily cost $54,000 (three retrievals at $45,000 plus three transfers at $9,000)

If she succeeds on the first transfer, she’s overpaid by $17,000 ($35,000 minus $18,000). If she does a third cycle and transfer, she’s saved $19,000 ($54,000 minus 35,000)

3 Cycle Bundle with 100% Refund:

Essentially, it’s the same dynamics as above, but if after three cycles she is not successful, she receives her money back. In this situation, the patient received $54,000 of treatment (three cycles and three transfers) for nothing (that is, aside from the money spent outside the program like the cost of medications, which we'll explain below).

In theory, this patient has been compensated for the worst possible outcome (no baby) with the most possible value (lots of free treatment). This is why refund programs are unique.

Who Are You Dealing With?

These programs are complex to administer and if a number of patients end up not getting pregnant, it can be costly for a clinic. As a result, some clinics don’t want the hassle or headache and let a third party handle the logistics and the risk. Integramed’s Attain program, and ARC, are two examples of plans run by a third party, and not the clinics themselves.

What Counts As Success?

In these programs, the clinic or third party has an obligation to provide you with all the treatments in the package you bought, or refund you, unless you meet some pre-defined threshold of success. As patients, we want that threshold to be as high as possible (taking home a healthy baby). Yet, many clinics and third parties feel their job is done when you get pregnant and leave their care. Below is a breakdown of what patients report their plan defined as “success” and we note that clinics generally set the bar fairly low.

Who Is Allowed To Enter & Who Wins?

Here we want to make a distinction between plans that offer a refund, and those that do not (we call them “plain packages”). Plans that offer refunds have the potential to be riskier for the clinic or third party, and so they function differently.

First and foremost, clinics and third parties closely filter who is allowed to enroll in their refund program. Often times the patient must be under 37 years old, have never had a miscarriage or failed IVF cycle, have a normal BMI and encouraging blood levels. Who does this rule out? Patients who are likely to be difficult to treat and cost the clinic or third party money.

Below is a chart of refund patients and the point at which they “succeeded” or failed & stopped. First thing you may notice is that 67% of all patients succeeded on the first retrieval. For context, nationally, only 34% of IVF cycles succeed. So patients who enrolled in these programs did way better than average. Why? Probably because they were great candidates. How good? 56% of all patients succeeded on the first transfer of the first cycle. Thus, for the vast majority of patients, they far overpaid to get a positive result that they would have gotten anyways.

But roughly 20% of patients didn’t succeed. For this minority, entering into the refund program was clearly a good deal financially. We believe when patients do a refund program through a third party, they are more likely to receive a refund compared with programs administered by a clinic itself, for reasons we explore below. Also, we found nearly every patient received the refund they claimed they deserved. Most with no hassle.

In short, if your clinic has a refund program and offers it to you, this may be a sign they are ultra-confident in your case, and so you may not want to enroll in their program. You’d likely succeed, and early, anyways. Conversely, if your clinic says you’re a good case and they have a refund program, but won’t include you, this may be a sign they are less bullish than they let on. Also, ask your clinic what percentage of patients end up getting a refund from them -- some clinics have never paid out a single refund, so they're very good at screening for good cases.

How about those “plain programs" where there is no refund component? That is less straight-forward. Clinics and third parties can still lose money on these programs, but not nearly to the extent as with a refund. As a result, clinics and third parties are not as uniformly strict on who can participate. Some clinics still have criteria around age and previous IVF failures, and others have no criteria at all. What’s less obvious is whether doctors and clinics market these “plain packages” aggressively to all patients, or are more likely to mention it to patients with easier cases.

Below is a similar chart about where in the treatment process patients “succeeded” or failed and stopped when they were in “plain packages." About 43% succeeded on first retrieval cycle, which is comfortably above the 34% national average. So it’s likely that patients who enrolled in these programs ended up being somewhat better-prognosis than the average patient, and thus overpaid, though not nearly to the extent of those who paid for a refund feature.

Do Doctors Or Clinics Take Needless Risk With Refund and "Plain Package" Patients

According to the State of New York's IVF task force, “when payment is linked to outcome, physicians may encourage patients to accept aggressive treatments that increase the chance of success without due regard for what those treatments may entail.” What we’re talking about is the risks of overstimulating the ovaries (to gather more eggs) thereby inviting OHSS, or transferring multiple embryos, which has risks for both mother and offspring.

This is a tricky subject and while we noticed most patients who enrolled in these programs had lower rates of multiple embryo transfer (roughly 50%) compared with the national average (roughly 70%), when we look at those patients who succeeded early in the refund program, 85% had been given a multiple embryo transfer. And yes, there are programs that incentivize (and even require!) the patient and doctor to use multiple embryos per transfer, so be on the lookout for that.

This is a big deal. Patients admitted to refund programs are typically under 35, and almost certainly under 37. These are the patients who should not be getting multiple embryos transferred according to ASRM guidelines, and the risks can be disastrous.

If you’re looking at a refund program or “plain package,” make sure you have access to an unlimited number of frozen transfers for no additional cost and that there are no minimum number of embryos you are required to transfer.

What You Really Pay To Participate

Whether you think these programs are a “good deal” is personal choice, but it’s crucial to know that nearly all of us will pay 25 – 50% more for our care than the list price of the package. We break this down into medical costs all patients accrue (e.g. medication) and financing costs, which some patients accrue.

Costs of Medical Exclusions

Every program has a list of exclusions and, as you can see below, some of them may be necessities (e.g. medication at $5,000 per cycle), some may be optional (ICSI at $2,500) and some are one-time in nature (pre-treatment diagnostics at $2,000 - $3,000).

Let’s play this out. If you thought you’d pay $25,000 for two cycles, the real cost might be closer $42,500 (two rounds of medication = $10,000, two rounds of ICSI = $5,000 and pre-testing = $2,500). If you thought you’d pay $30,000 for three cycles, the real cost might be over $50,000.

If you’re a hard case and you don’t succeed early in treatment, you may well be getting more treatment for free. And that’s great. But, your total out-of-pocket costs still rise with every subsequent cycle because every cycle involves medical necessities that are not included in what you pay to the clinic.

Let’s take medication, an absolute necessity. Most IVF cycles require medication that costs $3,000 - $7,000, so let’s say an average of $5,000. What you pay to the clinic doesn’t cover that, so even if the clinic gave you cycles for free, you still need to shell out $5,000 to the pharmacy. That’s $5,000 for one cycle, $10,000 for two cycles, and so on. Just because you participate in a package does not mean your costs will not continue to climb.

Costs of Financing

The reality is many patients cannot afford the upfront costs of a package (whether it involves a refund or not) and so 20 to 30% of patients will need financing to make the upfront payment. The clinics, as well as third parties, can arrange for loans through preferred providers like LendingClub, CapexMD, Prosper, Suntrust and others.

We have a piece up-coming, co-written with NerdWallet, about financing IVF, but for now this is what you need to know:

Patients typically arrange for 2 – 5 year loans, covering nearly all of their costs, at a 3 – 15% APR. On a $30,000 loan, this will drive an extra $2,000 - $20,000 in interest fees. If you miss a payment, the penalties are stiff, the costs quickly climb and you need to consider that when selecting how you want to finance this.

If you are dealing with ARC and Attain, every time you take out a loan, it costs ARC and Attain nearly 5%. You may want to ask ARC or Attain for a price break in exchange for not using a loan.

Patient Perceptions

How patients regard these programs is a curious thing. Generally speaking, those in refund programs end up being happier than those in “plain package” programs.

On one end of the spectrum are patients who succeeded in refund programs, who generally were successful on the first try, and, of all people, would be entitled to feel like this was a terrible deal: they paid many times over for a single treatment that would have worked anyway. But they were elated and loved the program.

On the otherhand, patients who bought a “plain package” and never succeeded (despite getting lots of free treatment) had misgivings about the program. Nearly a quarter of all patients who failed in these programs would have liked to change clinics but felt like they were locked into their clinic because of the agreement.

ARC and Attain

ARC and Attain offer refund and “plain package” programs. These programs strike a deal with clinics, create the criteria of who can participate and either keep the profits, or eat the losses, depending on how your treatment goes.

Attain

Summary:

Only offered through Integramed clinics (mostly large clinics in major cities)

Broad inclusion criteria for “plain packages,” tighter on allowing patients to be eligible for refund programs (e.g. must be under 38)

Claim high percentage of enrollees need to use multiple cycles, so many benefit

Offers unlimited frozen embryo transfers for every retrieval, which is a positive

20% of refund patients actually get a refund, with an interesting “opt-out at any time clause” (but a less advantageous clause where they can force you out with a refund)

We perceive the program as a driver of cycles to the clinic (which Integramed may partially own) rather than purely a stand-alone money maker

Detail:

Attain is offered through Integramed clinics (e.g. FCI in Chicago, SRM in Seattle, RSC in SF). Nearly any patient at an Integramed clinic qualifies for a “plain package” and about two thirds are eligible to buy a package with a refund feature.

Attain Plain Packages:

Attain claims 30 – 40% of those who sign up for an Attain package succeed on the first cycle. That implies 60 – 70% use multiple cycles and thus take advantage of more treatment at a lower cost.

Best we understand, Attain cycles include unlimited transfers. This matters because multiple-embryo transfers can be dangerous and in this case, patients have no disincentive from doing repeated single-embryo transfers (which ultimately yields equally high, or higher, success rates as transferring multiple embryos in a single transfer).

If you use all of the cycles and transfers in an Attain package, what would it save you compared to if you bought each treatment individually? The cost of a “2 cycle package” (with unlimited transfers) equates to 1.7x the costs of buying a single cycle (that would include only one free transfer). The cost of a “3 cycle package” (with unlimited transfers) equates to the the cost of buying two cycles (that each would include only 1 transfer) individually.

Attain Refunds:

Attain’s refund programs exclude women over 38 from using their own eggs, or who suffer from Diminished Ovarian Reserve. Attain’s refund structure is also unique because around 20% of Attain refund patients wind up with some kind of refund: either a 50% refund (for 2 cycle packages) or 100% refund (for 3 cycle packages). By contrast, we believe when patients use a refund package provided directly by a clinic, only about 10% ultimately receive a payout, if that.

Attain can pull you out of the program for any reason, and refund your money. It’s easy to imagine why they would do this for a 3-cycle refund patient who shows little promise after the first cycle. By getting pulled out and fully- refunded, this patient may have gotten one cycle for free, but lost the chance to get those future cycles for free. That’s not to the patient’s benefit.

On the otherhand, patients can get their entire refund if they decide to opt-out of the program, for any reason. For instance, if a patient pays $30,000 for a 3 cycle plan and decides to quit, Attain will send back 100% of the money paid up-front. And yes, that patient received the value of a cycle or two for effectively no clinical cost (but they will still have paid for medications, etc). The stipulation is that the patient must have transferred all viable embryos before quitting, which is industry-standard.

Other Details:

About 40% of Attain program users need to borrow money and Attain facilitates loans with three providers: LendingClub, CapexMD and HCS. These lenders keep 3 – 5% of the loan, pass on 95 – 97% to Integramed and so you might consider asking Integramed to lower its price if you chose to pay with a credit card or check.

Integramed is a for-profit company and administers Attain for a reason. We don’t believe Integramed makes much money betting against the patient in these situations. But Integramed owns many of the clinics that use Attain. They benefit when the clinics make money. Our belief is that Integramed administers Attain to help ensure its clinics get more cycles (and therefore revenue) per patient.

Surprisingly, a number of Integramed clinics (e.g. Shady Grove in DC) have decided not to offer Attain for reasons we’re trying to understand.

ARC

Summary:

ARC programs are offered at ~20% of all U.S. fertility clinics

Any patient at an ARC clinic can use the program: there are no clinical criteria to buy a “plain package”, or refund package

Refunds are given if the patient succeeds and still has unused cycles. This is an enormous departure from every other refund program in the U.S. This is a partial refund of pre-paid serviced never used

When clinics work with ARC, they receive 5 – 10% less, so it may make sense to seriously look into the ARC packages and use this as ammo to get the clinic to lower its pricing

Detail:

Unlike with Integramed’s Attain, ARC has no financial interest in the clinics that offer its program. Another difference? Nearly any patient can get into their refund program.

ARC packages are difficult to peg down because pricing and exclusions vary depending on which clinic you go to. At some clinics, the ARC packages include ICSI and unlimited transfers. At other clinics, those costs are a la carte.

While ARC has a refund program, it bears zero resemblance to any other. Nearly every patient is eligible and money is refunded when they are successful, which amounts to a portion of the treatments the patient paid for, but didn’t use. In this circumstance, you either walk away with a baby and some of your money back or no baby and no refund, but your treatments were at a discount.

The returned money is not pro-rated. Here’s an example for a major teaching hospital that uses ARC’s packages. Let’s say you sign up for 3 cycles at $36,000. If you have a baby during the first cycle, you receive back $16,000, not the pro-rated $24,000 of those two unused cycles. If you succeed on the second cycle, you receive back $7,000, not the pro-rated $12,000.

Conclusion:

Ultimately, refund and "plain package" programs are complex and varied. You need to need to ask yourself the questions about why you've been invited to join, at which point in treatment do patients like you - who were also invited to the program - ultimately succeed (insist upon getting this data), what the bar is for success, and what total costs are you likely to accrue.